China Generates The Buzz At DLD

The Digital-Life-Design conference this week was dominated by U.S. and European speakers—but some of the biggest buzz in Munich was around how much the future of the tech and media sectors is shifting to China.

Jim Breyer, a partner at Accel Partners, forecast that over the next 10 years roughly 75% of the market capitalization created by Internet and media businesses will come from companies outside the U.S. Roughly one-third of the overall total will be in China and about 10% in Europe, he predicts.

Mr. Breyer said his venture capital firm now has 11 partners in Beijing compared to just seven in its Silicon Valley offices in Palo Alto, Calif. “Our focus is on very fast-growing small Internet companies that we believe can scale to be very large in the Chinese market,” said Mr. Breyer in an interview on the sidelines of DLD.

Accel, whose high-profile stakes include Facebook Inc. and Groupon Inc., has raised $1.5 billion since 2005 from Accel investors for a China investment venture with IDG Technology Venture Investment. They’re now raising another fund for this purpose.

“What everyone is saying is right: it’s a great century to be Chinese,” said Esther Dyson, a New York-based angel investor, in an interview at DLD. But she said investing in China is harder and could carry more risks than some realize. “In the end, it’s state capitalism and you need to pick your partner very carefully,” Ms. Dyson said.

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